British automaker MG Rover and auto component manufacturer PowerTrain would set up manufacturing units in collaboration with tractor maker Sonalika in Himachal Pradesh, state Cooperative Minister Kuldeep Kumar has said.

International Cars and Motor, a newly floated Sonalika group company would manufacture multi-utility vehicles in technical collaboration with MG Rover at Una district of the state, he said.

The new entity of the Sonalika group will also produce components for Common Rail Direct injection engines to be manufactured by UK-based PowerTrain.

The company will be given benefit of excise exemption for 10 years from the start of commercial production and income tax holiday for first five years, an official release quoted Kumar as saying.